You already know where I stand on the shorter-term indicators with the current oversold condition. I have not changed my mind on those. But let's look at the intermediate-term indicators today.
None of the intermediate-term indicators that I follow are oversold. That, like sentiment, takes time to cycle through and a two- or three-week pullback is not enough to get them toward an oversold condition. But they are on their way.
One of the intermediate-term indicators I use is the 30-day moving average of the advance/decline line. The 10-day moving average is my short-term Overbought/Oversold Oscillator. I use the 30-day advance/decline line for an intermediate-term Oscillator.
You can see the big oversold condition in late December as well as the big overbought condition in mid-February. But since mid-February, this indicator has been losing steam. Remember oscillators are momentum indicators and they ought to oscillate back and forth. In this case, we've seen little oscillation since February, just a slow leak. It's difficult to say when it might get back to a good oversold condition, but the earliest I see even a small oversold condition is just after Memorial Day, and then not until mid-June.
The Volume Indicator also oscillates, usually between the low- to mid-40s and the upper-50s. The lower level is oversold, and the upper one is overbought. Here, too, you can see the giant oversold condition in December when this fell just under 42% and the huge overbought level when it tagged 60% in late February. The indicator is currently at 49%, so it is well on its way to moving into an oversold condition, but it is not there yet.
The Hi-Lo Indicator is another intermediate-term indicator. When it gets down under 20%, it's oversold. There is no overbought level for this, because, as you can see, sometimes it doesn't matter. And it has always been like this, it's not the advent of algorithms or exchange-traded funds or any such change in the market. It can get over 80% and stay there for long periods of time.
This is Nasdaq's, which is currently at 45%. It is only midway toward getting oversold. A big decline with tons of stocks making new lows for days on end will move it toward an oversold condition in a hurry, but barring a move like that, this would probably take a few weeks at least to get there, if it gets there.
We already know that the McClellan Summation Index is still heading down. This, too, is an intermediate-term indicator. Notice that it also peaked in March. Keep in mind it tells us how the majority of stocks are acting. So if you're wondering why it's so hard to make money in this market, here is the reason in one chart.
This indicator came very close to halting the slide late last week, when it only needed a net differential of +200 advancers minus decliners to stop going down, but Friday's poor breadth turned that number to +1600, which is actually better than it was a week ago when it would have required +3600 issues to halt the slide.
I would conclude that sentiment continues to sour on the market, as Friday marked the eighth-straight day with a put/call ratio over 100% and even the equity put/call ratio chimed in at a relatively high reading of 81%. It's probably "weekend" risk at play, here but I prefer not to rationalize an indicator. The 10-day moving average is still heading higher. I expect it will peak midweek this week.